TaxTMI 
TaxTMI 
2019 (5) TMI 1264
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....rounds of appeal filed by the assessee read as under:- "1. That on the facts and circumstances of the case and in law, the Assessing Officer ("AO") has erred in completing the assessment of the Appellant at INR 1,00,99,810/- as against Nil income returned by the Appellant. Grounds of appeal relating to Transfer Pricing adjustments: 2. That on the facts and circumstances of the case and in law, the AD / Dispute Resolution Panel (DRP") / Transfer Pricing Officer ("TPO") have erred in making TP adjustment of INR 1,00,99,809 in relation to the international transaction pertaining to sale of finished goods alleging the same to not to be at arm's length as per the provisions of Chapter-X. 3. That on facts a....
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.... the 100% export oriented unit (EOU'). 9. That on the facts and in the circumstances of the case and in law, the AO I DRP have erred in setting off brought forward business losses and unabsorbed depreciation which were pertaining to the EOU, against the profit of the EOU, before computing deduction under section l0B of the Act. 10. That on the facts and in the circumstances of the case and in law, the AO / DRP have erred in not allowing set-off of brought forward business losses and unabsorbed depreciation available to the Appellant, against the income assessed, post the adjustments made by TPO / AO. 11. That on the facts and circumstances of the case and in law, the AO has erred in charging interest under sec....
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...., the assessee showed the Cost of goods sold as Rs. 819.46 lakhs (Rs. 1172.18 (-) Rs. 352.72), i.e., the assessee had netted off the stock difference credit against raw material consumed. The TPO, however, took the view that the assessee has brought the stock difference of Rs. 352.72 lakhs to the Expenses side of Profit and Loss account in order to artificially reduce the operating cost to the tax payer and comparables. Hence he did not accept the same and accordingly reworked the PLI. The Ld DRP also confirmed the same. 6. We heard the parties on this issue and perused the record. In the financial statements, the Stock difference was shown in the credit side of Profit and Loss account, since the value of closing stock was more than the ....
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.... the assessee has sought for inclusion of both the comparables before the TPO for the first time. It is the contention of the assessee that the TPO did not include them and did not provide any reason for his action and the Ld DRP also did not examine the functional profile of both the companies. In the written submissions, it is stated that M/s Talbros Engineering Limited is engaged in the business of production of motor vehicle parts and M/s Jotindra Steel Tubes Limited is engaged in the business of manufacture of steel pipes & tubes. We have earlier noticed that the assessee is engaged in the business of manufacture and export of aircraft engine parts, components and sub-assemblies. Before us, the assessee could not show as to how the fun....
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.... quantum of depreciation would depend upon the value of assets. If any of the companies have replaced its assets with latest one, then the cost of new asset would be high resulting in high amount of depreciation. Accordingly he opposed to the plea of the assessee. 11. With regard to this contention of the assessee that the cash profit (profit before depreciation) should be considered as PLI, we notice that the same finds support from the decision rendered by the co-ordinate bench in the case of DCIT vs. M/s Centum Rakon India P Ltd (IT(TP)A No.472/Bang/2016 dated 20-07-2018), wherein the co-ordinate bench has followed the decisions rendered in the case of Honeywell Technology Solutions Lab vs. DCIT (61 SOT 61)(URO)(Bang.); 24/7 Customer.....
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.... the basis of installed capacity and actual production. A cursory perusal of the same, in our view, would show that there may be some error in it, since it would be difficult to achieve capacity utilization of 218% in the normal industry standard. We notice that the assessee has not attempted to ascertain the facts in this regard and offer reasonable explanations. Accordingly we do not find merit in this ground urged by the assessee and accordingly reject the same. 13. Ground No.7 relates to the benefit of +/- 5% range. It is consequential in nature. In view of the above, the issue relating to determination of ALP of international transactions needs to be recomputed in the light of discussions made supra. 14. Ground No.8 & 9 relates t....